Tehran Transit Funds Vanish; Tussle over President's Tuesday TV Talk

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Another financial controversy is developing. Mohammad Reza Mahmoudi, deputy governor-general for development of Tehran province, claimed that the government paid about $55 million in subsidies for the Tehran subway system and another $30 million for the capital's public bus system, but Mohammad Gholi (pictured), chief operating officer of the subway company, denied that the funds were received and asked Mahmoudi to announce the account number to which the money was supposedly sent. Mahmoudi then changed his claim. First he told a reporter, "Perhaps, as we speak, the funds are being deposited"; later on, he said, "Perhaps the funds will be deposited in the next day or two." Several days later, subway officials still insisted that no funds had been received. After Gholi reported on the matter to the Tehran City Council, Mehdi Chamran, a conservative council member, said that he would pursue it with President Ahmadinejad.

Eleven Majles deputies have filed a complaint against Ahmadinejad with Majles Speaker Ali Larijani. The subject of the complaint is the embezzlement of close to $3 billion that has roiled the regime in recent weeks. The deputies state, "Preliminary investigations indicate that some officials of the executive branch [a reference to Esfandiar Rahim Mashaei, Ahmadinejad's chief of staff and close confidant] used their position to support [the culprits], certain banking officials who were not qualified were appointed, and legal oversight of the banking system was not performed, either intentionally or due to irresponsibility." The next step is for Larijani to refer the case to a parliamentary commission for investigation. Four leading critics of Ahmadinejad, Ahmad Tavakoli, Ali Reza Zakani, Elias Naderan, and Parviz Sarvari -- the last three all former officers in the Islamic Revolutionary Guard Corps -- are among the 11 deputies who signed the complaint.

In a meeting with a group of officials, Supreme Leader Ayatollah Ali Khamenei said that the press should not blow the embezzlement case out of proportion. He warned that some want to use the scandal to hurt the system that he supports, claiming that if authorities had responded to his past warnings, the financial corruption that has gripped the nation would not have taken root. He added that the source of the corruption goes back "years ago," implicitly placing the blame on the administrations of Mohammad Khatami and Akbar Hashemi Rafsanjani.

The Globe and Mail has published a picture of a luxurious $3 million house in Toronto, which it claims belongs to Mahmoud Reza Khavari, the former Bank Melli chief who resigned last week amid the embezzlement scandal and fled to Canada. According to the newspaper, "Property records show a Toronto home that's registered in Mr. Khavari's name not far from newspaper magnate Conrad Black's mansion in Toronto's affluent Bridle Path neighborhood. The Suncrest Drive property was bought for $2,925,000 on July 30, 2007. When The Globe and Mail approached the house Friday, a woman at the property would not answer any questions." The BBC has also reported on the home and tried to speak to a woman who lives there, but she refused. Khavari was scheduled to return to Iran last Thursday, but did not. Entekhab, a moderate conservative website, reported that over the past few years Khavari has purchased eight travel agencies in Canada, all registered under his son's name, one of which is apparently Jerry Kaplan Travel. Entekhab also reported that the Ministry of Intelligence opposed Ahmadinejad's appointment of Khavari to head Bank Melli.

According to the Ayandeh website, which is close to Rafsanjani, Khavari "is not just a fugitive, but a box of secrets" that can be used by foreign governments if he does not return to Iran; as chief of Bank Melli, Khavari had access to many confidential matters of state. After his departure for Canada, the pro-Ahmadinejad newspaper Iran severely criticized the judiciary for not barring him from leaving the country. Ayandeh responded that if this logic is reasonable, the first people who should be barred from traveling abroad are Mashaei; First Vice President Mohammad Reza Rahimi; and Vice President for Executive Affairs Hamid Baghaei, who have all been accused of financial corruption.

Vali-ollah Zarrabieh, chief of Bank Saman, which played an important role in the embezzlement, has been sacked. The order for his firing was issued by Mahmoud Bahmani, the Central Bank governor.

As reported by Tehran Bureau, two weeks ago Iran claimed that Ahmadinejad possesses 140,000 documents containing sensitive information about 314 senior officials and political figures and threatened that they would soon be released. Two such revelations now appear to have occurred. First, Dolat-e Ma published documents concerning the advanced degree that Majles deputy Tavakoli received in Britain many years ago. According to the documents, he never received a bachelor's degree, but received a scholarship for an M.S., and without studying for it received another scholarship for a doctorate. He traveled to Britain for his studies where he sought and received financial assistance for his family when, in fact, they did not accompany him. Although his Ph.D. degree is not recognized as a true doctorate but as an "equivalent," he received salary and benefits in his government job commensurate with a full doctorate.

Dolat-e Ma also reported that the Kayhan Organization, which publishes the hardline daily Kayhan,owes about $11 million to the Social Security Organization, which provides subsidized health insurance. Dolat-e Ma said that Kayhan, under managing editor Hossein Shariatmadari, has "exploited" its staff. "Some employees of Kayhan have worked there for up to seven years without any health insurance," the website said, saying that the paper's unpopular positions and misguided policies have drastically reduced its subscription and advertising base, and hence its earnings. In its Sunday issue, Kayhan confirmed the Dolat-e Ma report, but also claimed that the government itself owes the SSO about $22 billion. Kayhan claimed that it is paying back its debt in monthly installments, but that the government has postponed payment of its debt. In response, Dolat-e Ma declared that the newspaper "receives billions for its budget, but is destroying the Kayhan Organization, which is a large cultural and press organization." It appears that Dolet-e Ma is launching a counterattack in response to Kayhan's recent editorials that have tried to link the culprits behind the multibillion-dollar embezzlement case with Ahmadinejad administration officials.

On another front, the fissures between Ahmadinejad and his camp and Khamenei and the hardliners continue to deepen. As reported by Tehran Bureau, the hardliners have formed the so-called 7+8 Committee to draw up a list of joint candidates for the upcoming Majles elections next March. The spiritual leader of the committee is Ayatollah Mohammad Reza Mahdavi Kani, chairman of the Assembly of Experts. In turn, reactionary cleric Mohammad Taghi Mesbah Yazdi has formed Jebheh Paaydaari-ye Enghelab-e Eslami (JPEE, or the Durable Front for the Islamic Revolution), composed of former Ahmadinejad administration officials and former Revolutionary Guard officers, as well as reactionary clerics around Mesbah Yazdi. The group has been critical of some members of the 7+8 Committee and insists they be removed before the JPEE joins the unity effort. For example, it has said that because Majles Speaker Larijani and Tehran Mayor Mohammad Bagher Ghalibaf were mostly silent in the aftermath of the presidential election of June 2009, they do not deserve to have representatives on the committee. Cleric Seyyed Reza Taghavi, a committee member, said that negotiations with Mesbah Yazdi's group have been fruitless and it appears that they will present a separate list of candidates for the Majles elections. Former Majles Speaker Gholam Ali Haddad Adel, father-in-law of Ayatollah Ali Khamenei's son Mojtaba, has repeatedly declared that the Supreme Leader wants the hardliners, who refer to themselves as the principlists, to be united for the parliamentary campaign. Khamenei and his supporters are worried that Ahmadinejad and his group may take control of the Majles in the next elections.

In an interview, Majles deputy and Ahmadinejad critic Ali Motahari strongly criticized the JPEE, saying that its founders "did not do anything for the Revolution." He said that they "accidentally" took place of the true revolutionaries and that the main reason for the JPEE's founding is its founders' enmity toward people like Rafsanjani and Larijani. According to Motahari, the JPEE represents Ahmadinejad and Mashaei, rather than any significant social grouop, and their claim that they support Ahmadinejad but reject Mashaei is a contradiction in terms.

The rates of exchange between the Iranian rial and major Western currencies have increased over the past several weeks by at least 10 percent, which affects the price of virtually all goods and services. Economist Mohammad Khosh Chehreh, a former supporter and now critic of Ahmadinejad, said that the administration manipulated the rates to make billions that it will use in its campaign for the Majles. He added that the exact figure for what the government is earning from the rate increase is unknown and even the Supreme Audit Court cannot calculate it. Central Bank governor Bahmani has said that his organization will control the rates, but many experts say that the rate of exchange between the rial and the U.S. dollar may soon rise from its current level of approximately 1,300 to 1 and reach 2,000 to 1.

Two Majles commissions approved a plan to divert water from the Aras River to Lake Orumieh. According to the plan, 1.07 billion cubic meters of water from the river, on Iran's border with the Republic of Azerbaijan, will be transferred to the endangered salt lake.

Masoud Shafiei, the attorney who represented Shane Bauer and Josh Fattal, the American hikers who were released recently after two years of imprisonment in Iran, has been barred from leaving Iran. He was detained and interrogated last week, after the two hikers strongly criticized the Islamic Republic in a press conference.

Manouchehr Sahabi, father of Nahal Sahabi, 37, who committed suicide last week, denied that there was any romantic relationship between his daughter and Behnam Ganji, 22, who committed suicide earlier in September. He said that the fact that his daughter's suicide was so close to Ganji's was accidental. He also claimed that his daughter had never been detained -- in contradiction of widespread reports -- and that her suicide was not directly political, but that "the collective set of what has happened in the society caused her suicide."

Several days after the arrest of journalist Hamid Moezzeni, who worked on Mehdi Karroubi's 2009 presidential campaign, there is no information on his whereabouts or why he was arrested. He has been allowed only one brief phone call with his family.

Khaleh Meshal, head of the political office of Hamas in Syria, said that the request of Palestinian Authority President Mahmoud Abbas for recognition of an independent Palestinian state and full membership in the United Nations is a courageous act worthy of support. Meshal, speaking at the Fifth International Conference in Support of the Palestinian Intifada in Tehran, declared, "We cannot deny that this action has had symbolic and moral achievements." He said that it has "isolated the Zionist regime and the United States. There is a good international consensus that has revealed the [true] ugly face of the U.S. policy and Israel's position." At the same time, Meshal said that the action should not be considered in isolation. He demanded to "first liberate Palestinian lands and then ask the United Nations Security Council for U.N. membership."

At the same conference, Khamenei rejected Abbas's call, which recognizes the partitioning of historical Palestine. Last week, Abbas asked the U.N. to recognize an independent Palestine based on the borders before the 1967 war that would consist of the West Bank, Gaza, and East Jerusalem. Khamenei said, "Our aim is freedom for [all of] Palestine, not part of it. Any plan that aims to partition Palestine must be completely rejected. The idea of two states that has been covered up with the membership of the Palestinian government in the UN is nothing but acceding to the Zionists' demands, meaning accepting a Zionist government in the Palestinian land."

The conference in Tehran has provided another excuse for Ahmadinejad's critics to attack him. While Khamenei was in attendance, during which he talked with several other conference participants, he was accompanied by Majles Speaker Larijani. Ahmadinejad, who was present at the same time, did not accompany Khamenei, violating the usual protocol. He was in another corner of the conference center, talking with other participants. This has been taken by his critics as evidence of his unacceptable "individualism."

In reaction to Khamenei's speech, Israeli Prime Minister Benjamin Netanyahu said that his opposition to the partition of Palestine into two independent states only confirms Israel's views about the Islamic Republic and the need to strengthen Israel's security. Although in his speech, Khamenei emphasized that Iran's solution for the Palestinians' problem is "neither classic war nor throwing the Jews into the ocean," Netanyahu referred to the Iranian government as the "satanic government of the mullahs." Khamenei said that all of Palestine, from nahr (river, meaning the Jordan River) to bahr (sea, meaning the Mediterranean Sea), must be a unified Palestinian state.

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